Concerned Shareholder Sues PAREXEL Over Allegedly Misleading Proxy

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A stockholder has filed suit against PAREXEL International Corporation and its board of directors alleging that the defendants issued a misleading proxy statement in relation to a proposed merger with Pamplona Capital Management, LLP. The plaintiff claims that the approximately $5 billion transaction undervalues the company and that shareholders “are not able to rely on the integrity of the process that led to the Proposed Transaction or properly evaluate the adequacy of the consideration being offered for their shares.” According to the suit, the proxy statement omits material information concerning the background of the transaction, PAREXEL’s financial projections, and potential conflicts of interest faced by the individual defendants and the company’s financial advisor – Goldman Sachs.

The plaintiff suggests the defendants and Goldman Sachs may have been swayed by their own interests in their decision to recommend the merger. The proxy statement allegedly fails to note whether PAREXEL executives will be granted employment in the future company. Additionally, the complaint claims that one of the individual defendants is a retired partner of Goldman Sachs and argues that the proxy statement neglects to disclose the full relationship between the defendants and their financial advisor.

As a result of these supposed non-disclosures, the proxy statement is misleading and illegal, the plaintiff says. The suit demands that the defendants reveal the missing information so shareholders can fairly determine whether they support the proposed merger.